6 Financial Tips for Service Members and Their Families
Miliary famlies face unique financial challenges, particularly when a service member is deployed. The American Bankers Association has highlighted six financial tips to help military families reduce the stress of managing money.
“Finances are often identified by service members and their families as one of their most significant stressors – even more than deployments and personal relationships,” said Corey Carlisle, executive director of the ABA Foundation. “Financial concerns at home make it extremely difficult for service members to focus on the mission at hand. Planning ahead as much as possible is key for the millions of military families who face unique financial challenges like deployments and relocations.”
ABA offers the following financial tips for service members and their families:
- Contribute automatically to a Thrift Savings Plan. Military members have access to the Federal Thrift Savings Program, which offers the lowest-cost retirement savings plan available. Have automatic contributions withdrawn from your paycheck.
- Plan for deployment. Before deployment, have a family conversation about managing the household budget. Consider granting power of attorney to your spouse, should they need to make any urgent financial decisions while you are gone. Check with your bank to see if they have pre-printed forms you can use for bank accounts. Military personnel also receive additional funds while deployed. Decide on the best use for that extra cash, whether it is paying off debt or increasing Thrift Savings Plan contributions.
- Meet with your banker before active duty. The Servicemembers Civil Relief Act offers all military personnel entering active duty a variety of financial protections. The SCRA covers issues ranging from interest rate reductions to limits on debt accrual. Ask your banker about the key provisions of this law and how they can help you.
- Set up automatic bill pay. Whether you’re stationed stateside or overseas, automatic bill pay will give you and your family one less thing to worry about each month. It can be particularly helpful during deployments in regions where internet access is unreliable and mobile banking isn’t an option.
- Consider housing options. With mortgage rates at notably low levels, homeownership may seem like a no-brainer. However, service members should consider their options. Frequent relocations and deployments can make owning a home challenging and expensive. Renting may be a smart option for short-term assignments. Decide what’s best for your family and your finances.
- Consult a financial advisor. Schedule a visit at a Personal Financial Management Program (PFMP) office, located in your military and family support centers. They offer free one-on-one counseling, as well as other financial education resources.
The Consumer Financial Protection Bureau also provides tips and resources for service members at consumerfinance.gov/servicemembers. For more consumer tips and resources from ABA on a variety of personal finance topics such as mortgages, credit cards, protecting your identity and saving for college, visit aba.com/Consumers.